Importance of Achieving Equity in Pay Structures - 5344 Words

Importance of Achieving Pay Equity Table Of Contents What is Equity in Organizations? 4 The Equity Theory 4 Inputs 5 Outcomes 6 Importance of Equity in Pay Structure 7 Internal Equity 9 Steps to Achieving Internal Equity 9 Methods Commonly Used 9 Job analysis 9 Job Evaluation 11 Ranking Method 12 Classification Method 13 Factor Comparison Method 13 Point Method of Job Evaluation 14 Strategic Considerations 15 External Equity 16 Steps to Achieving External Equity 16 Compensation Surveys 16 Benefits of Pay Surveys to the Organization 17 Published Compensation Survey 18 Custom Developed Compensation Surveys 19 Compensation Surveys: Strategic†¦show more content†¦When the ratio of inputs to outcomes is close, than the employee should have much satisfaction with their job. Outputs can be both tangible and intangible (Walster, Traupmann Walster, 1978). Typical outcomes include any of the following: †¢ Love †¢ Intimacy †¢ Job Security †¢ Esteem †¢ Salary †¢ Employee benefit †¢ Expenses †¢ Recognition †¢ Reputation †¢ Responsibility †¢ Sense of achievement †¢ Praise †¢ Thanks †¢ Stimuli Importance of Equity in Pay Structure Following are some of the benefits gained by having an equitable pay structure within the organization †¢ It is a protection against legal charges of discrimination based on race, gender, etc. †¢ It brings consistency in the pay structure, therefore allows for easy alignment with overall company strategy. Now it is only required to make adjustments for achieving organizational goals. The already structured and consistent pay structure will easily absorb the changes. In contrast a non-consistent (haphazard) pay structure will require more effort to adopt anyShow MoreRelatedJetBlue Airways Case Study1730 Words   |  7 Pagesteam Experienced Cohesive Smart Well-funded Flexible workforce Serious competition if they threaten major carriers Potential competition with SWA as SWA grows Though industry for start-ups Difficult to hire quickly at high standards No structures for building team and participation as they grow Lack of standardization in HR policies could be source of inequity, division Flight attendants turnover could create high training costs, poor service Jet Blue Strategy: Low cost, low price Read MoreFinancial Ratios Analysis and Comparison Paper1478 Words   |  6 Pagesorganizations to understand their present performance and weak areas in order to generate more effective operational strategies. 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Financial statementsRead More Components of Compensation paid to Employees Essay2459 Words   |  10 Pagesorganisations as it conveys information to an employee about their relative importance to the organisation and provides a scale to identify how much recognition they are receiving for their contribution (Harley and Stephenson, 1992). Compensation shows employees how much they are appreciated and worth. The most important differentiating element between jobs is the effort involved in performing a job (Biesheuval, 1985). †¢ Objectives of pay systems (Harzing and Van Ruysseveld, 1999): Objective: How to